Correlation Between BICO Group and Siemens Healthineers
Can any of the company-specific risk be diversified away by investing in both BICO Group and Siemens Healthineers at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining BICO Group and Siemens Healthineers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BICO Group AB and Siemens Healthineers AG, you can compare the effects of market volatilities on BICO Group and Siemens Healthineers and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in BICO Group with a short position of Siemens Healthineers. Check out your portfolio center. Please also check ongoing floating volatility patterns of BICO Group and Siemens Healthineers.
Diversification Opportunities for BICO Group and Siemens Healthineers
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BICO and Siemens is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding BICO Group AB and Siemens Healthineers AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Healthineers and BICO Group is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on BICO Group AB are associated (or correlated) with Siemens Healthineers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Healthineers has no effect on the direction of BICO Group i.e., BICO Group and Siemens Healthineers go up and down completely randomly.
Pair Corralation between BICO Group and Siemens Healthineers
Assuming the 90 days horizon BICO Group AB is expected to under-perform the Siemens Healthineers. In addition to that, BICO Group is 2.22 times more volatile than Siemens Healthineers AG. It trades about -0.01 of its total potential returns per unit of risk. Siemens Healthineers AG is currently generating about 0.02 per unit of volatility. If you would invest 5,114 in Siemens Healthineers AG on August 30, 2024 and sell it today you would earn a total of 186.00 from holding Siemens Healthineers AG or generate 3.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 77.17% |
| Values | Daily Returns |
BICO Group AB vs. Siemens Healthineers AG
Performance |
| Timeline |
| BICO Group AB |
| Siemens Healthineers |
BICO Group and Siemens Healthineers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BICO Group and Siemens Healthineers
The main advantage of trading using opposite BICO Group and Siemens Healthineers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BICO Group position performs unexpectedly, Siemens Healthineers can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Siemens Healthineers will offset losses from the drop in Siemens Healthineers' long position.| BICO Group vs. Anteris Technologies | BICO Group vs. Brain Scientific | BICO Group vs. Aurora Spine | BICO Group vs. Tenon Medical |
| Siemens Healthineers vs. Artivion | Siemens Healthineers vs. Anika Therapeutics | Siemens Healthineers vs. Sight Sciences | Siemens Healthineers vs. Orthofix Medical |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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